UAL, Union to Start Talks on Concessions

UAL Corp.’s United Airlines and the union representing its mechanics and baggage handlers plan to start talks this week on worker concessions as the carrier tries to avoid filing for bankruptcy protection.

The machinists union is Chicago-based United’s largest labor group, representing about 36,000 workers.

United’s five unions last month decided to jointly provide the airline with $5 billion in concessions over five years to help reduce costs and win a $1.8-billion federal loan guarantee.

UAL, the second-largest airline, has said it can’t afford to repay $875 million of debt due this quarter without the help and might have to file for bankruptcy.

The machinists union will keep working with the other unions on the recovery effort while negotiating on its own on the amount of concessions it will provide, said Scotty Ford, a district president for the union.

United and the unions always have expected that each union eventually would have separate talks with the company on details of new agreements.

Standard & Poor’s, which lowered its corporate credit ratings for UAL and United in August, said that the airline and parent company remain on its CreditWatch list.

UAL, which reports third-quarter earnings on Friday, has said it may have to file for Bankruptcy Court protection if the company cannot secure significant labor concessions.